Raketech Revenue Drops By 48% Prompting Shift In Strategy

Raketech Group Holding has reported significant financial challenges, with a year-on-year revenue decline of nearly 50% in Q1 results released last week. The total revenue for the period reached €9.8 million, marking a stark decrease of 48.8% from €19.0 million in Q1 2024.

This substantial drop in revenue corresponded with an adjusted EBITDA that plummeted over 50%, falling to €2.4 million from €5.1 million in the same quarter last year. Additionally, net EBITDA decreased by 50.8% to €2.1 million, down from €4.3 million in Q1 2024. Ultimately, the company faced a net loss of €0.842 million, a significant shift from the net income of €0.174 million recorded in Q1 2024.

A contributing factor to these financial results was the underperformance of Raketech’s digital marketing brand, Casumba, particularly in the Japanese market. Acquired in 2020 for an initial €2.3 million—along with a potential €20.6 million earnout based on performance—the brand’s disappointing performance has had repercussions. A payment of €6 million was made in Q1, with an additional €2 million expected in Q2; however, the remaining balance has been postponed to March 2028, allowing the company time to stabilize. Notably, free cash flow before earnouts totaled €1.7 million in Q1 2025, making the deferment of payments potentially critical for Raketech’s financial recovery.

Strategic Realignment at Raketech

In addition to the aforementioned challenges, Raketech’s US sports betting tips and subscription services incurred a negative EBITDA impact of €0.3 million. Consequently, the company is reevaluating its service offerings and shifting away from an SEO-heavy marketing strategy in favor of forging strategic partnerships in alternative sectors.

Raketech is also focusing on enhancing its AffiliationCloud platform. In Q1, the company announced four new partnerships. Total affiliate marketing revenue amounted to €6 million, with approximately 50% derived from entrepreneurial collaborations. The company emphasized its intent to expand these partnerships further throughout 2025.

To bolster its financial stability, Raketech has implemented cost-cutting measures, resulting in a 41% year-on-year reduction in the workforce and a 34% decrease in operating expenses compared to Q1 last year.

Leadership Perspective: A Transitional Phase

CEO Johan Svensson characterized these results as a period of transition for the company. He stated, “Q1 2025 represents a strategic consolidation and operational focus for Raketech.” He further noted that, despite the revenue decline, the company has made tangible progress in aligning its operations with a platform-first model and long-term growth objectives.

“With AffiliationCloud positioned at the core of our operations and a strengthened financial footing from our recent decisions, we are optimistic about scaling efficiently and fostering sustainable value,” Svensson added. While the deferral of the Casumba payment has enhanced the company’s financial standing, the upcoming quarters will be critical for monitoring earnings recovery.

In its statement, Raketech reported that April’s performance mirrored the figures from Q1 2025. “Revenues from our Affiliation Marketing assets in April 2025 remain consistent with Q1 2025; however, the lower-margin Paid Network (SubAffiliation) continues to experience headwinds,” the statement indicated.

The outlook remains uncertain, with the potential for ongoing headwinds to continue impacting the company’s growth trajectory.

In conclusion, Raketech’s current strategies highlight an adaptive approach to a challenging market scenario. The extent to which these adjustments can pave the way for recovery and profitability will undoubtedly be a focal point for both investors and stakeholders moving forward.

Adam Roarty brings years of expertise in the gambling industry, with a robust background in content writing and editing for notable publications such as Oddschecker, CoinTelegraph, and Gambling Industry News, equipping him with a profound understanding of sports betting and online gambling nuances.